Question

Which of the following is not true about generally accepted accounting principles (GAAP)? GAAP provide guidelines...

Which of the following is not true about generally accepted accounting principles (GAAP)?

GAAP provide guidelines as to how to account for specific events impacting the financial performance of a firm

The application GAAP accounting rules help ensure consistency so analysts can compare one firm’s financial performance to another

It is customary for Definitive Purchase Agreements to require that a target company represent that its financial books are kept in accordance with GAAP

GAAP always guarantees that a firm’s financial books are accurate

Differences between how a firm records actual financial transactions and how they should be recorded based on GAAP could indicate fraud or mismanagement.

Homework Answers

Answer #1

The statement "GAAP always guarantees that a firm’s financial books are accurate" is NOT true

This is because following the guidelines provided under GAAP ensures that a firm's books are reliable and comparable with another firm's financial statements , but conformance with GAAP cannot guarantee that a firm's financial books are always accurate, since accountants are quite skilful when it comes to manipulation of financial data/ numbers even while conforming to the guidelines prescribed under GAAP

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
US generally accepted accounting principles(GAAP) is similiar but not identical to International Financial Reporting Standards (IFRS)....
US generally accepted accounting principles(GAAP) is similiar but not identical to International Financial Reporting Standards (IFRS). Please compare and contrast their financial accounting guidelines.
GAAP refers to guidelines for accounting information in the United States. The acronym GAAP in this...
GAAP refers to guidelines for accounting information in the United States. The acronym GAAP in this statement refers to: True or False: The accounting guidelines required in the United States are called Generally Accepted Accounting Principles (GAAP). True or False: IFRS are a global set of accounting standards; however, these standards are not yet utilized in any country. True or False: IFRS are established by the Financial Accounting Standards Board (FASB). The acronym IFRS standards for: True or False: Both...
When preparing financial statements under Generally Accepted Accounting Principles (GAAP) we have a measurement or dollar...
When preparing financial statements under Generally Accepted Accounting Principles (GAAP) we have a measurement or dollar valuation issues we must always consider. It is called “Conservatism”. What is conservatism in accounting and how does it work? What impact does this issue have on the preparation of the GAAP basis financial statements?
What are the differences between Generally Accepted Accounting Principles (GAAP) and IFRS concerning recognition of cash...
What are the differences between Generally Accepted Accounting Principles (GAAP) and IFRS concerning recognition of cash and related items?
Generally accepted accounting principles (GAAP) are in some common instances dissimilar from accounting for income taxes....
Generally accepted accounting principles (GAAP) are in some common instances dissimilar from accounting for income taxes. These dissimilarities give rise to differences between income reported on the financial statements (book income) and the income used to compute the actual tax liability (tax income). These differences may be temporary or they may be permanent. Compare and contrast temporary and permanent differences between book and tax income. What is the basic cause of the differences between book and tax income? Why do...
Which of the following is in accordance with generally accepted accounting principles? Accrual-basis accounting Cash-basis accounting...
Which of the following is in accordance with generally accepted accounting principles? Accrual-basis accounting Cash-basis accounting Both accrual-basis and cash-basis accounting Neither accrual-basis nor cash-basis accounting
Generally accepted accounting principles are: mandatory rules applied to both financial and management accounting. standards of...
Generally accepted accounting principles are: mandatory rules applied to both financial and management accounting. standards of accounting, a material departure from which may result in a qualified opinion issued by an auditor. optional procedures for recording economic events. the rules of accounting, prescribed exclusively by Federal regulatory agencies.
When preparing external financial statements that are in accordance with generally accepted accounting principles, the minimum...
When preparing external financial statements that are in accordance with generally accepted accounting principles, the minimum financial report will include A. Basic financial statements, management's discussion and analysis, and other required supplementary information. B. Only the financial section of a comprehensive annual financial report. C. Basic financial statements only. D. A comprehensive annual financial report.
Which of the following accounting principles does the Securities and Exchange Commission (SEC) require U.S. firms...
Which of the following accounting principles does the Securities and Exchange Commission (SEC) require U.S. firms to use when filing their financial statements? - International Accounting Standards Board (IASB) - International Financial Reporting Standards (IFRS) - Generally Accepted Accounting Principles (GAAP) - National Advisory Accounting Standards (NAAS) - Financial Accounting Standards Principles (FASP)
.1. Which of the following is not a correct statement about accounting? a. Generally accepted accounting...
.1. Which of the following is not a correct statement about accounting? a. Generally accepted accounting principles (GAAP) is a set of accounting standards used in the preparation of financial statements. b. Financial Accounting Standards Board (FASB) is a private organization delegated by the Federal Reserve with the responsibility to establish the GAAP. c. Management accountants work with a business or nonprofit organizations, preparing reports and analyzing financial info. d. Public accountants provide a variety of accounting services for clients...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT